Rice exports from Vietnam may increase 14 per cent in the first quarter as the strongest El Nino in almost two decades shrivels crops in some countries, spurring importers to build reserves.
Shipments will jump to 1.3 million metric tonnes in the three months ending March from 1.14 million tonnes a year earlier, said Tran Tuan Anh, Vietnam’s deputy minister of industry and trade. The world’s third-biggest exporter is already seeing a spurt in demand, he said in an e-mail on Nov. 25. October rice shipments surged 43 per cent to 859,000 tonnes from a year earlier, the highest level since July 2012, government data show.
Indonesia and the Philippines are among nations importing rice after dry weather induced by the strongest El Nino since the record event in 1997-98 hurts crops. Prospects for the event to further strengthen may prompt buyers to secure supplies before prices run up as the United Nations’ Food & Agriculture Organization predicts a decline in global rice output in the 2015-16 season with consumption surpassing production.
“Rice supply and stockpiles will decline, and demand for imports will rise because of unfavorable weather conditions,” Anh said. “The El Nino event occurring this year and prolonging into 2016 will affect production in many countries, especially Thailand, Indonesia, and the Philippines.”
Rough-rice futures on the Chicago Board of Trade have rallied 29 per cent from the lowest level in more than eight years in May on concern that the El Nino will shrink global harvest. The contract for delivery in January closed at $12.13 per 100 pounds on Wednesday.
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